Self assessment soluzione

Pagina 1

1. The “product full manufacturing cost”: □ Includes only the costs of “direct” resources (i.e. resources whose consumption by products can be measured in a very accurate and precise way) □ Includes all manufacturing variable costs incurred in the production of each unit of that item □ Includes all operating variable and fixed costs concerning that product (depreciation, salary of production supervisors, sales, administration and general expenses etc.) □ None of the previous answers 2. In a manufacturing company, the depreciation cost of a piece of equipment used to manufacture different products (i.e. different items) is an example of: □ A variable, direct cost □ A fixed, indirect (or “manufacturing overhead”) cost □ A variable, indirect cost □ A fixed, direct cost 3. XYZ ltd manufactures only one type of product. In June 2017, the company incurred the following costs: Direct materials 31,000 € Direct labour 18,000 € Factory rent 12,000 € Equipment deprecation – factory 2,000 € Equipment depreciation – sales office 750 € Marketing expenses 2,500 € Administrative expenses 40,000 € In the same month 35. 000 units were produced . What is the full production (or manufacturing) unitary cost? □ 1.80 €/u □ Approximately 3.04 €/u □ Approximately 1.82 €/u □ None of the previous answers 4. In terms of precision, Activity Based Costing is supposed to perform better than other product costing systems (such as Job Order Costing) when: □ Indirect costs are the large majority of product costs AND the company manufactures both niche and mass products using the same (indirect or “common”) resources □ Indirect costs are the large majority of product costs AND products are very similar (with regard to production processes and lot sizes) □ Direct costs are the large part of product costs…